India’s effort to govern artificial intelligence may be heading back to first principles. Six months after the Centre proposed changes to regulate AI-generated content on social media, policymakers are now debating whether oversight should start one step earlier, by spelling out what an “AI intermediary” is and how it differs from the online platforms already covered by the law, Mint reported on 28 October.

According to the report, lawyers and Big Tech firms have made representations to the Ministry of Electronics and Information Technology (MeitY), and policy whitepapers have been submitted arguing that AI intermediaries need a definition distinct from India’s social media intermediary rules.

An AI law on the horizon

The discussion comes as the government moves towards dedicated legislation. On 8 October, IT Minister Ashwini Vaishnaw said MeitY would release a consultation paper for a standalone AI law. The idea has gained ground after a year of grey-area content incidents on AI platforms, including sexualised images generated through Grok, the chatbot on Elon Musk’s X.

The stakes are significant. India is one of the largest markets for AI, and OpenAI has said the country has more than 100 million weekly active users.

Why AI does not fit the old template

India currently decides intermediary status largely under the Information Technology Act, 2000, and the IT (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021. That status matters because it brings safe harbour, the protection that shields platforms from legal and criminal action over content their users post.

Generative AI blurs that line. Services such as ChatGPT, Gemini, Claude and Meta AI produce output using their own models, data and judgement in response to user prompts. A senior Big Tech executive, speaking anonymously, told the publication that liability is shared because the user writes the prompt, but noted that some court rulings abroad have found AI platforms do editorialise generated content to a degree, which complicates their claim to intermediary status and safe harbour.

A September study by policy think-tank The Quantum Hub, which OpenAI pointed to, argues that the 2026 amendments to the IT Rules placed obligations on synthetically generated information without first identifying which AI actors count as intermediaries. The report says this creates regulatory ambiguity.

One law or many rules?

The prospect of a European Union-style AI law has divided opinion. Lawyers see it as a move in the right direction. Big Tech executives would rather have sector-wise rules than one overarching statute.

Supreme Court senior advocate NS Nappinai, founder of Cyber Saathi, said India needs a full overhaul of intermediary laws for AI and several other use cases. In her view, laws should enable as well as restrict, and lawmakers should look beyond intermediary provisions towards technology-agnostic legislation. She added that special provisions in existing laws would be a sound alternative, and that the EU AI Act offers a precedent India can build on.

A senior official familiar with MeitY’s position, quoted anonymously, described a conflict between two industry demands. Firms reject an overarching regulation that could stifle a nascent technology, yet they also want a fresh intermediary definition that would give AI platforms safe harbour. The official said both cannot happen together without consensus, and that MeitY does not want to be heavily prescriptive even as the need for regulation grows.

What CIOs should watch

For enterprises building or deploying generative AI in India, how the intermediary question is settled will shape liability, compliance duties and vendor contracts. Technology leaders should follow MeitY’s consultation paper closely. Whether AI providers end up classed as intermediaries, publishers or a new category will determine who answers for AI-generated output.

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